Reality of situation outweighs what contract says
A British Columbia worker was in an employment relationship and entitled to reasonable notice of termination, despite the existence of a contract labelling him an independent contractor, an adjudicator has ruled.
Matthew Rennie was a helicopter maintenance engineer for VIH Helicopters, an aviation service provider based in North Saanich, B.C. Rennie was hired in 1993 as a sole proprietorship under the name Matt Rennie Engineering. Three years later, VIH told Rennie he must incorporate in order to remain working for the company. VIH told him the same thing in 1998, with the stipulation VIH would make payments to his new company through invoices.
Rennie’s father incorporated a new company under the name Blue Stone Engineering, which then entered into a contract with VIH to provide Rennie’s services in helicopter maintenance for one year. The contract stipulated that an engineer who provided the services was an employee of Blue Stone and Blue Stone would be responsible for paying, hiring, firing and supervising its employees and for making the appropriate payroll deductions, though he would be under the direction of a VIH maintenance supervisor. The contract was renewed annually.
On Oct. 15, 2008, VIH terminated the contract effective Oct. 30. The two weeks’ notice was in accordance with the termination clause. Rennie made several attempts to find out why he was being terminated, but VIH didn’t formally give him any information. He heard second-hand there was a problem with his attitude and not his performance.
Rennie filed a complaint of unjust dismissal under the Canada Labour Code, asserting he was entitled to reasonable notice as an employee. VIH argued he had chosen to be an independent contractor when Blue Stone was incorporated rather than remain an employee.
The adjudicator found VIH had much of the control and direction of Rennie’s work, as many of his work activities were directed and supervised by a VIH maintenance supervisor. Though Rennie’s attendance and work hours were flexible, he usually worked similar hours as other VIH employees and the actual work dealing with the repair and maintenance of helicopters was the result of decisions by VIH, said the adjudicator.
The adjudicator also found though Rennie used some of his own small tools, VIH provided all special tools, equipment, work clothing and transportation to job sites. Rennie was also paid for expenses such as meals, accommodation and cellphone costs.
Though VIH argued Rennie was free to work for other companies, his sole employment and income was from VIH and the work he performed was “an integral part of the business of the company,” said the adjudicator.
The adjudicator also found Blue Stone was created to meet VIH’s request for an incorporated entity to take Rennie’s place on the payroll. This didn’t change the working arrangement between them “on a day-to-day basis.” Though VIH made payments to Blue Stone for Rennie’s work, the money was always Rennie’s, said the adjudicator.
